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Judge Leaves Open Possibility Of Three Pot Licenses In Northeast Florida

Leon County Judge John Cooper on June 30, 2022, in a screen grab from The Florida Channel.
Wikimedia Commons
The Florida Channel
Leon County Judge John Cooper on June 30, 2022, in a screen grab from The Florida Channel.

Medical marijuana licenses given to two Northeast Florida nurseries by state health officials cannot be challenged by a grower who lost out in the application process, an administrative law judge ruled Monday.

But Judge R. Bruce McKibben left open the possibility for Loop's Nursery and Greenhouses to get a third license in the region.

McKibben's seven-page order Monday is the latest twist in Florida's drawn-out medical marijuana saga and hinged on a new law, passed in March, aimed at eliminating uncertainty stemming from multiple challenges to dispensing organization licenses granted by health officials in November.

Gainesville-based Chestnut Hill Tree Farm was one of five nurseries selected to grow, process and distribute marijuana low in euphoria-inducing THC under a 2014 law that was sought by parents of children with severe forms of epilepsy. The law authorizes the cannabis for patients with certain conditions, such as severe muscle spasms or cancer.

Two other growers in the Northeast region --- San Felasco Nurseries and Loop's --- challenged the sought-after license. Chestnut Hill filed a separate petition seeking to ensure that its license would become final although it had not received the highest ranking by health officials. The cases were consolidated, with a hearing scheduled for late July.

But the new law, as evidenced by McKibben's ruling Monday, changed the landscape of the challenges --- and the licenses. The law, passed by the Legislature and approved by Gov. Rick Scott in March, revamped the 2014 low-THC law that has been tangled in legal challenges.

Under this year's law, each of the five dispensing organizations are allowed to keep their licenses, and the Department of Health must also issue licenses to applicants whose challenges are successful. The law also authorized full-strength medical marijuana for terminally ill patients.

McKibben ruled in February that health officials had wrongly disqualified San Felasco Nurseries, which received the highest score in the Northeast region. The Department of Health granted the Gainesville-based grower a dispensing organization license --- the region's second --- on April 4.

Because of the new law, Chestnut Hill's and San Felasco's licenses are "approved without further review," McKibben wrote.

"We are pleased with the ALJ's ruling and look forward to continuing to work with the (Department of Health's) Office of Compassionate Use on implementing this important program for those Floridians who need it," Chestnut Hill's lawyer, John Lockwood, said.

While Loop's can't challenge the other licenses, the nursery "may, however, pursue approval of its own application" under part of the new law that requires health officials to grant licenses to winners of administrative or court challenges, McKibben wrote on Monday.

"If Loop's can show that 'it was entitled to be a dispensing organization' in the instant proceeding, then it may also be approved," McKibben, quoting from the new law, added.

McKibben's order dismissed the case against Chestnut Hill and allowed Loop's to amend its complaint.

Loop's lawyer, Jon Moyle, said he is reviewing McKibben's ruling.

"We'll be deciding on next steps, given that the order concludes three licenses are available in the Northeast region," Moyle said Monday.

McKibben also cautioned that the Department of Health ultimately has the power to decide whether Loop's receives a third license because the judge only has "recommended order authority" in the case. Health officials and administrative law judges handling cases in two other regions have been engaged in a power struggle over the challenges.

The judges insist that, under Florida law, the agency's decision to grant the licenses is not final until final orders in the cases had been issued. But health officials moved forward with the process anyway, authorizing dispensing organizations to start growing marijuana even before any hearings in the cases began.

McKibben's ruling, which dealt only with the Northeast region, could signal what might happen in the challenges to licenses in the Central and Southwest regions.

Judges in all three cases were expected to perform a "de novo" hearing in which they would essentially re-rank the applicants to determine who should receive the licenses.

The new law also makes the dispensing organizations responsible for growing full-strength medical marijuana for terminally ill patients. The expectation is that the same dispensing organizations would also be allowed to provide pot products to a vastly expanded patient base if a constitutional amendment on the November ballot passes. That proposed constitutional amendment would allow patients with a variety of conditions to have access to full-strength marijuana.